PAG E 3 Marina Property Risks Continued PROTECTING YOUR PROPERTY ® mandatory. If that happens, marina operators will have to give more thought to insurance considerations that owners of property on land have long been accustomed to. Even today, marinas have to comply with the same codes regulations as any other structures or facilities with comparable features. To that end, they are advised to acquire coverage for increased costs to reconstruct a damaged property so that it complies with regulations for land use, construction, electrical and plumbing systems, or any other features subject to updated building codes and similar laws enacted after the original construction and before a loss occurs. “Many marinas need to upgrade to code after a loss,” says Hayman at GGG/AI. “They should make sure they secure proper code upgrade coverage.” Should any elements of resiliency become mandatory, marina operators will need to know to what extent their property insurance will cover additional costs to meet resiliency standards when repairing or replacing damaged property. Green Even if marina resiliency standards remain voluntary, marina operators may face a challenge in maintaining their resilient marina designation following a loss. The situation here is analogous to what commercial property risk and insurance professionals face with “green” building construction. Under green construction, buildings are designed and constructed to meet standards established by international organizations for energy efficiency and environmental impact. Under green property policies, a building that attained a certain green ranking can be repaired or replaced to standards required to maintain their ranking — even if the standards for the ranking have been raised. In this way, it is theoretically possible for the owner of a greeninsured building to have it repaired or replaced in a manner at a cost higher than that of the original structure, even if the upgrades are not mandatory, and even if the standards are altered between the time a designation is first earned and the time a loss occurs. Electrical Concerns Although risk and insurance professionals recognize distinctions among property exposures, bailment exposures, and third-party liability exposures, the three are inextricably linked for practical purposes—and under intensifying regulatory scrutiny. Today, no marina can update its electrical system without careful consideration of the risk of “electric shock drowning,” or ESD, which occurs when low voltage AC current flows through recreational waters. The AC current is typically not strong enough to electrocute people, but it can paralyze and prevent them from calling for help or swimming to safety. From 2006-16 there were at least 60 incidents of ESD or electrocution in recreational waters, according to a report by Quality Marine Services, LLC, of Jacksonville, Florida. The report emphasizes that those are only the incidents researchers are aware of; ESD leaves no evidence after death and may have contributed to more deaths than reported.3
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